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5.Troubled companies

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1 Dec 2022 (AFR) – Dixon Advisory clients to receive pittance under deed of arrangement

(1 December 2022, AFR, p21, Carrie LaFrenz and Jonathan Shapiro) – Here is a case study example of the possible outcomes when investing in various funds. “Dixon Advisory’s administrators have told the failed group’s creditors – all of whom are current and former clients in its ASX listed US property fund – to back a … Continue reading

12 July 2022 (AFR) – Wirecard forged client details to secure $1.3b SoftBank investment

(12 July 2022, AFR, p26, from Financial Times) – This delve into the recent Wirecard fraud case is incredulous, due to the huge amount of money embezzled. “Frankfurt/London | Wirecard forged client data and lied about internal records to secure a €900 million ($1.3 billion) investment from SoftBank that was seen as a vote of … Continue reading

7 July 2022 (AFR) – Greed drew Goldman to dubious fund

(7 July 2022, AFR, p28, Aaron PatrickSenior correspondent) – This news article gives a great insight into the workings of some hedge funds. “You probably haven’t heard of Bill Hwang, but until the COVID-19 pandemic, he ran a $50 billion hedge fund that blew up in one week. The family-owned fund, Archegos, was one of … Continue reading

7 Feb 2020 (AFR) – Businesses struggling to pay creditors jump 29pc

(7 February 2020, AFR, p7, Matthew Cranston, Economics correspondent) ‘The number of businesses defaulting on payments jumped 29 per cent in 2019, pointing to an increase in insolvencies in the year ahead. Drawing on data from the Australian Securities and Investments Commission and Australian Financial Security Authority as well as courts and debt collectors, CreditorWatch’s … Continue reading

5 Feb 2020 (TheAge) – Retail: Colette by Colette Hayman collapses, 140 stores at risk

(5 February 2020, The Age, p12, By Dominic Powell) ‘Poor trading and a failed funding agreement have led to the collapse of women’s fashion retailer Colette by Colette Hayman, placing 140 stores and hundreds of jobs at risk in the ongoing brutal retail environment. The handbags, jewellery and fashion accessories brand was put in the … Continue reading

31 Jan 2020 (AFR) – Retail: Greenlit Brands’ losses balloon to almost $300m

(31 January 2020, AFR, p24, Sue Mitchell, Senior Reporter) ‘Losses at Greenlit Brands, Australia’s second-largest furniture retailer, rose ninefold to almost $300 million in 2019 after the owner of Freedom, Fantastic and Snooze slashed the value of assets such as goodwill and losses mounted at department stores Harris Scarfe and Best & Less. According to … Continue reading

30 Jan 2020 (AFR) – More collapses to come in retail’s ‘killing season’

(30 January 2020, AFR, p15, Sue Mitchell, Senior Reporter) ‘The growing popularity of Black Friday promotions, a shift to online shopping and burgeoning debt levels have contributed to the recent spate of retail collapses, according to the administrator of struggling clothing chain Jeanswest.  In what has been dubbed the retail “killing season”, half a dozen … Continue reading

24 Jan 2020 (AFR) – Jeanswest to close quarter of stores in attempt to lure buyers

(24 January 2020, AFR, p17, Sue Mitchell, Senior Reporter) ‘Struggling casual clothing retailer Jeanswest is closing one quarter of its stores, with the loss of 263 jobs, in an attempt to lure buyers after falling into voluntary administration last week.’ Read more at (might need AFR login access)

23 Jan 2020 (theAge) – ‘Gobsmacked’: German retail giant Kaufland abandons Australia, adding to retail woes

(23 January 2020, The Age, Business, p22, By Dominic Powell and Simon Johanson) ‘Property developers have been left “gobsmacked” after a shock announcement from German hypermarket Kaufland that it would leave the Australian market, despite never opening a store and investing over half a billion dollars on property, staff and distribution. The company, which is … Continue reading

21 Jan 2020 (AFR) – Super Retail profits hit by bushfires, more downgrades to come

(21 January 2020, AFR, p13, Sue Mitchell, Senior Reporter) ‘Investors in retail stocks are bracing for more profit downgrades as retailers count the cost of the bushfires, which have disrupted trading and dented already fragile consumer confidence. Shares in Super Retail Group fell more than 2 per cent on Monday after Australia’s largest auto accessories, … Continue reading

21 Jan 2020 (AFR) – Bushfires: Small business owners worry recovery fund won’t save them

[COMMENT: With many stories like this one, we wonder how much of an impact there will be to the general economy with the flow-on effects from the December-January bushfire tragedies.] (21 January 2020, AFR, p6, Bo Seo and Fiona Carruthers) ‘The federal government’s relief package for bushfire-affected businesses has elicited mixed reactions among business owners, … Continue reading

21 Jan 2020 (TheAge) – Retailer warns Australians have lost confidence to go on holiday as sales hit by fires

(21 January 2020, The Age, Business, p23, By Dominic Powell) ‘Rebel Sport owner Super Retail Group says Australians have lost confidence in going on holiday after the company warned its earnings had been significantly hit by the devastating bushfire crisis. Super Retail – which owns Supercheap Auto, Rebel Sport, Boating Camping Fishing (BCF) and Macpac … Continue reading

18 Jan 2020 (AFR) – Drought and competition shrivel Nufarm earnings

(18 January 2020, AFR, p21, Liam Walsh, Reporter) ‘Shares in Nufarm have tumbled after the agricultural supplies outfit unveiled a massive dent in earnings from extreme weather pitching its Australian arm into the red, and fierce competition in Europe.’ Read more at (might need AFR login access)

18 Jan 2020 (AFR) – Profit downgrades reveal share risks

(18 January 2020, AFR, p1, Tom Richardson and Luke Housego) ‘A shock profit downgrade from agri-chemicals group Nufarm has amplified concerns that Australian stocks won’t be able to sustain their gains without a turnaround in earnings growth to back up elevated valuations after a historic week for shares. The sharemarket’s best start to the year … Continue reading

16 Jan 2020 (AFR) – Short sellers poised to swoop as earnings disappointments loom

(16 January 2020, AFR, p27, Sarah Turner, Reporter) ‘The stakes appear unusually high for companies this earnings season, with short sellers poised to claim the rewards as companies trade on some of the richest valuations in history, inviting ruthless punishment for missed expectations. ASX-listed companies are gearing up to report first-half earnings in February, meaning … Continue reading

16 Jan 2020 (TheAge) – Fashion chain Jeanswest collapses as retail sector continues to struggle

(16 January 2020, The Age, Business, p24, By Dominic Powell) ‘National fashion chain Jeanswest has been placed into voluntary administration, blaming high rents as it becomes the fourth victim of Australia’s languishing retail market since the start of the year. KPMG’s Peter Gothard and James Stewart were appointed administrators of the chain on Wednesday afternoon, … Continue reading

15 Jan 2020 (AFR) – Mosaic shares tumble on bushfire update

[COMMENT: A sign of the times – poor retail environment plus bushfire flow-on effects.] (15 January 2020, AFR, p15, Lucas Baird, Reporter) ‘Investors have sent Mosaic Brands’ market value tumbling in reaction to a dire sales update over the business impacts of bushfires. The fashion retailer – formerly known as Noni B – saw its … Continue reading

15 Jan 2020 (TheAge) – Fires deal devastating blow to businesses in Victoria’s north-east

(15 January 2020, The Age, By Benjamin Preiss) ‘Businesses in Victoria’s north-east are bracing for shocking losses from this summer’s bushfires that could exceed an estimated $200 million for the region’s economy over three months. A survey of 200 tourism-dependent businesses in the north-east found that half of them experienced 100 per cent losses between … Continue reading

11 Jan 2020 (AFR) – Fallen icon: The undoing of Harris Scarfe

[COMMENT: The current challenges for retailers…] (11 January 2020, AFR, p19, Carrie LaFrenz, Senior Reporter) ‘December is supposed to be the busiest time of the year for retailers as Christmas approaches and shoppers make last-minute purchases. But that wasn’t the case for South Australian retail icon Harris Scarfe, which had been struggling for years with … Continue reading

10 Jan 2020 (TheAge) – Retail fashion: Fashion chain Bardot closes 58 stores as analysts predict poor Christmas trade

(10 January 2020, The Age, Business, p23, By Dominic Powell) ‘The closure of 58 Bardot stores across the country has kicked off the new year on a sour note for retailers, with some analysts predicting a worse-than-expected trade across the key Christmas period. Before Christmas, shopkeepers had been concerned about slow sales in the key … Continue reading

3 Jan 2020 (TheAge) – Macquarie pulled into massive Dropbox class action

[COMMENT: Here is another good example for the investors and traders who try to read the stories in the price charts. The share price of Dropbox had been down trending for months, and astute traders and investors would have sold out months ago. This news story (below) might cause more ructions for the share price.] … Continue reading

18 Dec 2019 (AFR) – National building supplier SWC collapses

(18 December 2019, AFR, p33, Nila Sweeney, Reporter) ‘Melbourne-based residential and commercial supplier SWC Management Group has collapsed after it ran out of money to meet $69 million in obligations, including unpaid wages, putting around 400 staff out of work.’ <snipped…> ‘SWC blamed the downturn in building construction, slumping sales and tight competition for its … Continue reading

3 Dec 2019 (AFR) – AustralianSuper stares down shorts on Syrah

(3 December 2019, AFR, p14, Peter Ker, Resources reporter) ‘Australia’s biggest superannuation fund says the investment thesis that attracted it to Australia’s most shorted stock remains intact, in a major vote of confidence for struggling graphite producer Syrah Resources. Syrah shares have fallen by 94 per cent since June 2016 and its ability to outlast … Continue reading

29 Nov 2019 (AFR) – Retail bricks and mortar: Womenswear retailer Bardot joins fashion victims

(29 November 2019, AFR, p19, Sue Mitchell, Senior Reporter) ‘Fast fashion retailer Bardot has become the latest victim of weak retail spending and increasing competition from global and online retailers, falling into administration on Thursday. Brendan Richards and Ryan Eagle of KPMG were appointed voluntary administrators and have appointed Deloitte Corporate Finance to look for … Continue reading

27 Nov 2019 (AFR,WashPost) – Malls are dying. The thriving ones are spending millions to reinvent themselves.

(27 November 2019, AFR, p34, By Abha Bhattarai) ‘Abdul Mannan was perched on a stool, scrolling through his phone, on a recent afternoon at Lakeforest Mall in suburban Washington. He was two hours into his shift at a jewelry kiosk and had yet to exchange words with a single customer.’ <snipped…> ‘… But in the … Continue reading

19 Nov 2019 (AFR) – Prospa hammered on earnings downgrade – slumps 27pc

(19 November 2019, AFR, p11, James Eyers, Senior Reporter) ‘Prospa’s largest shareholders say the small business lender’s shock earnings downgrade five months after listing is a major disappointment, but its strategy to chase higher quality customers – which hit its revenue margin in recent months – will ultimately make it a stronger company. Prospa shares … Continue reading

14 Nov 2019 (AFR) – Failed company case study: Former RCR boss counts on ‘honest’ defence

[COMMENT: This is a case study example of a listed public company that went belly up, and the share market investors lost all of their investment. Caveat Emptor. Investors need to watch out for the tell-tale signs and bail out in advance. The signs are often there in the share price chart – see adjacent … Continue reading

25 Oct 2019 (AFR) – IPO performance: Ten years on the Myer float still rankles

(25 October 2019, AFR, p8, Sue Mitchell, Senior Reporter) ‘Why are some shareholders willing to forgive and forget when companies fail to achieve profit guidance, while other shareholders take them to court to recover losses? In the case of Myer, shareholders are still rankled over the circumstances behind the department store chain’s $2.3 billion initial … Continue reading

25 Oct 2019 (AFR) – Business backs away from Hong Kong

(25 October 2019, AFR, p2,  Jennifer Hewett, Columnist) ‘The protest movement in Hong Kong may have badly embarrassed Beijing and further undermined the image of Chinese President Xi Jinping. But it won’t succeed in its aim of evading China’s uncompromising assertion of its authority – sooner or later. What the protesters have clearly achieved, however, is … Continue reading

25 Oct 2019 AFR) – Don’t crash for me Argentina

(25 October 2019, AFR Review supplement, p1, Michael Stott and Benedict Mander) ‘The victor of this Sunday’s election in Argentina will inherit one of the world’s most unenviable economic messes. Inflation is running at 55 per cent a year, the economy is in a deep recession, poverty is rising, billions of dollars have fled the … Continue reading